Press Release
Starting Jan. 1, 93 percent of Ontario income tax payers will get a permanent tax cut as part of a comprehensive tax plan that will help create 591,000 jobs and make the province more attractive for new business investment.
The province is cutting the first income bracket tax rate by one percentage point, from 6.05 percent to 5.05 percent.
As a result, Ontario will have the lowest tax rate of all provinces on the first income bracket, and an additional 90,000 lower-income Ontario taxpayers no longer will pay any provincial personal income tax.
The comprehensive package also includes $10.6 billion in direct payments and permanent tax relief, including the following:
•Starting in August, nearly 3 million low- to middle-income Ontario families and individuals will receive a new, permanent Ontario Sales Tax Credit of up to $260 for each adult and child per year—one of the most generous in Canada.
•An additional $270 million in annual property tax relief, through enhancements to the Ontario Property Tax Credit, will benefit 2.3 million low- to middle-income homeowners and tenants.
•Starting in June, Sales Tax Transition Benefits will benefit 6.5 million Ontario families and individuals—totalling up to $1,000 for families (including single parents) and up to $300 for single people—in 2010 and 2011.
“Our tax changes are about helping Ontario families by creating jobs and putting more money in their pockets through tax breaks and credits,” said Revenue minister John Wilkinson.
In November, economist and tax expert Jack Mintz estimated these tax changes, together with other recent tax measures, will create 591,000 new jobs within 10 years. About 83 percent of consumer expenditures will not see a new tax under the HST. In fact, the HST will result in the removal of $4.5 billion a year in hidden sales taxes when fully phased in.
This means prices on some items will come down.
On July 1, federal and provincial sales taxes will be merged into the Harmonized Sales Tax (HST).
